STRATEGIC RECRUITING IN A DOWN ECONOMY ERE Expo East 10/30/08 © Dr. John Sullivan www.drjohnsullivan.com Dr John Sullivan [email_address]

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Topics for today How to predict when cuts are coming Why this downturn will be different What are the positive aspects Potential problems Proactively approaching the CFO Low cost/ high impact actions Other things recruiters can do Your questions

How to predict when cuts are coming

Why this downturn will be different

What are the positive aspects

Potential problems

Proactively approaching the CFO

Low cost/ high impact actions

Other things recruiters can do

Your questions

How to predict future cutbacks in recruiting Precursors or warning signs The number of Req approvals needed goes up Travel freezes Paper clip memo Contract recruiters are let go Other firms freeze their hiring (See their web page) A hiring freeze at your firm Recruiting budget cuts Layoffs

Precursors or warning signs

The number of Req approvals needed goes up

Travel freezes

Paper clip memo

Contract recruiters are let go

Other firms freeze their hiring (See their web page)

A hiring freeze at your firm

Recruiting budget cuts

Layoffs

Why this downturn will be different

Why this downturn will be different

This downturn will be different Factors that make this downturn different Volatility of stock markets (firm valuation) and credit availability mean spurts of growth Global markets mean somewhere there will be local growth Global competition will increase in order to regain lost status, lost markets and lost customers Expectations for innovatio n will not decrease

Factors that make this downturn different

Volatility of stock markets (firm valuation) and credit availability mean spurts of growth

Global markets mean somewhere there will be local growth

Global competition will increase in order to regain lost status, lost markets and lost customers

Expectations for innovatio n will not decrease

This downturn will be different Factors that make this downturn different Churn will be common – Where you hire and release at the same time (HP) Real estate option – Recruiters will not have this career alternative to fall back on

Factors that make this downturn different

Churn will be common – Where you hire and release at the same time (HP)

Real estate option – Recruiters will not have this career alternative to fall back on

The top advantages of recruiting during tough times

The top advantages of recruiting

during tough times

Advantages of recruiting during tough times 1) Less competition from other firms – Because of their reduced recruiting budgets As well as the loss of their top recruiters Candidates will be easier to sell because they will have fewer options… and fewer counter offers to choose from

1) Less competition from other firms –

Because of their reduced recruiting budgets

As well as the loss of their top recruiters

Candidates will be easier to sell because they will have fewer options… and fewer counter offers to choose from

Advantages 2) More high quality candidates will be available More higher quality released/ laid off individuals be on the market Less loyalty among the “survivors” (401k cuts, mergers etc) Action step - An opportunity to “trade up” (SWAP) talent Action step - It is an opportune time for "counter cycle" recruiting where you “load up” with great talent (College market)

2) More high quality candidates will be available

More higher quality released/ laid off individuals be on the market

Less loyalty among the “survivors” (401k cuts, mergers etc)

Action step - An opportunity to “trade up” (SWAP) talent

Action step - It is an opportune time for "counter cycle" recruiting where you “load up” with great talent (College market)

Advantages 3) Weakened employment brands “ Public” layoffs, ethical issues and mergers have weakened some brands (Yahoo, Citi, Merrill Lynch etc.) Raid weak firms while you still can Action step - This provides increased opportunities for firms that maintain or intelligently strengthen their employment brand during this period

3) Weakened employment brands

“ Public” layoffs, ethical issues and mergers have weakened some brands (Yahoo, Citi, Merrill Lynch etc.)

Raid weak firms while you still can

Action step - This provides increased opportunities for firms that maintain or intelligently strengthen their employment brand during this period

Advantages 4) Turnover and retirement rates will decrease Downturns… increase the desire for job security Which means… lower turnover (Because new hires have no tenure) Fewer retirements due to the dramatic reduction in the value of their 401(k)’s, may ease some baby boom retirement concerns

4) Turnover and retirement rates will decrease

Downturns… increase the desire for job security

Which means… lower turnover (Because new hires have no tenure)

Fewer retirements due to the dramatic reduction in the value of their 401(k)’s, may ease some baby boom retirement concerns

Advantages 5) Higher quality recruiters will be available Many excellent recruiters will be available for those firms planning for the long-term 6) The dollar is stronger The newly strengthened US dollar makes recruiting international candidates (paid in $) much easier

5) Higher quality recruiters will be available

Many excellent recruiters will be available for those firms planning for the long-term

6) The dollar is stronger

The newly strengthened US dollar makes recruiting international candidates (paid in $) much easier

Advantages 7) New recruiting technology is available The availability of social networking, text messaging, YouTube, Google searches and other web-based technologies now makes effective recruiting possible with little or no budget

7) New recruiting technology is available

The availability of social networking, text messaging, YouTube, Google searches and other web-based technologies now makes effective recruiting possible with little or no budget

Advantages 8) An opportunity to explode out of the box Well prepared firms will have the capability of "exploding out of the box" immediately after the downturn is over This capability will put you far ahead of other firms that have decimated their recruiting capabilities during this time

8) An opportunity to explode out of the box

Well prepared firms will have the capability of "exploding out of the box" immediately after the downturn is over

This capability will put you far ahead of other firms that have decimated their recruiting capabilities during this time

Advantages 9) Tight times make you stronger Tight budgets and the extra pressure could force you to focus more on metrics and a strong business case By eliminating the deadwood, streamlining processes and focusing on the best approaches , you will eventually strengthen the function over-all

9) Tight times make you stronger

Tight budgets and the extra pressure could force you to focus more on metrics and a strong business case

By eliminating the deadwood, streamlining processes and focusing on the best approaches , you will eventually strengthen the function over-all

Advantages 10) Workforce planning will be encouraged It's usually a "fight" to convince executives to invest in workforce planning Economic volatility and the pain of laying off talent they fought so hard to acquire almost always convinces senior managers of the need for a strong workforce planning function Action step - Use this "lull" to develop an effective forecasting capability and a "flexible" recruiting strategy that "shifts" during the different economic cycles

10) Workforce planning will be encouraged

It's usually a "fight" to convince executives to invest in workforce planning

Economic volatility and the pain of laying off talent they fought so hard to acquire almost always convinces senior managers of the need for a strong workforce planning function

Action step - Use this "lull" to develop an effective forecasting capability and a "flexible" recruiting strategy that "shifts" during the different economic cycles

Advantages 11) Some industries will suffer less Healthcare, defense, financial regulators, green technologies etc. may suffer fewer negative impacts

11) Some industries will suffer less

Healthcare, defense, financial regulators, green technologies etc. may suffer fewer negative impacts

The top 10 recruiting problems you might face during tough economic times

The top 10 recruiting problems

you might face during tough economic times

Potential problems Executives are already viewing this as a time of surplus talent or opportunity Some see it as a time where no recruiting will be needed for years Others see it as an opportunity to “cherry pick” This has already led to dramatic changes at some major firms (Deloitte, MS, E&Y, Yahoo etc)

Executives are already viewing this as a time of surplus talent or opportunity

Some see it as a time where no recruiting will be needed for years

Others see it as an opportunity to “cherry pick”

This has already led to dramatic changes at some major firms (Deloitte, MS, E&Y, Yahoo etc)

Potential problems 2) Resource freezes are common Hiring freezes - One of the first knee-jerk reactions Budget / new project freezes … increase turnover Promotion freezes Freeze on raises

2) Resource freezes are common

Hiring freezes - One of the first knee-jerk reactions

Budget / new project freezes … increase turnover

Promotion freezes

Freeze on raises

Potential problems 3) Stock options are no longer a major motivator They become a less reliable as a motivator both for current employees and for candidates Need to shift your sales approach to candidates to emphasize exciting work, flexible work, better benefits, more security or to focus on cash performance bonuses

3) Stock options are no longer a major motivator

They become a less reliable as a motivator both for current employees and for candidates

Need to shift your sales approach to candidates to emphasize exciting work, flexible work, better benefits, more security or to focus on cash performance bonuses

Potential problems 4) Job security is king Volatility makes both employees and candidates nervous about their future This fear makes “drawing them away” harder Action step - Re-examine the information you provide on job security on your website , in position descriptions and in its offers in order to make your security more compelling

4) Job security is king

Volatility makes both employees and candidates nervous about their future

This fear makes “drawing them away” harder

Action step - Re-examine the information you provide on job security on your website , in position descriptions and in its offers in order to make your security more compelling

Potential problems 5) An increased volume of traffic Unfortunately if you actively recruit during tough times, the volume of mediocre but enthusiastic unemployed people that will apply for your jobs will also increase dramatically This high-volume, low quality flow means that your screeners will be strained and that your selection process has to be more precise

5) An increased volume of traffic

Unfortunately if you actively recruit during tough times, the volume of mediocre but enthusiastic unemployed people that will apply for your jobs will also increase dramatically

This high-volume, low quality flow means that your screeners will be strained and that your selection process has to be more precise

Potential problems 6) Relocation issues Moving people between regions becomes nearly impossible when individuals can't get credit, new mortgages or sell their existing homes This problem affects both internal transfers and new hires Action step - Consider focusing on recent college grads that generally rent or consider “narrowing” your recruiting area to a reasonable commuting distance

6) Relocation issues

Moving people between regions becomes nearly impossible when individuals can't get credit, new mortgages or sell their existing homes

This problem affects both internal transfers and new hires

Action step - Consider focusing on recent college grads that generally rent or consider “narrowing” your recruiting area to a reasonable commuting distance

Potential problems 7) A loss of trust and confidence The general mistrust of business means your employees and candidates will likely now have less trust and confidence in anything that you say Layoffs will hurt your firm’s brand - Although you probably can't stop layoffs, work with PR to ensure they don't become front-page news Action step - Your website must be more objective and believable, your interviews need to be more credible and your offers will need to be stronger, if you expect to convince the cynical

7) A loss of trust and confidence

The general mistrust of business means your employees and candidates will likely now have less trust and confidence in anything that you say

Layoffs will hurt your firm’s brand - Although you probably can't stop layoffs, work with PR to ensure they don't become front-page news

Action step - Your website must be more objective and believable, your interviews need to be more credible and your offers will need to be stronger, if you expect to convince the cynical

Potential problems 8) Managers will focus less on recruiting Manager’s interest in recruiting will decrease even further as the stress from their business workload increases, while their available staff decreases They certainly won't be doing it as often Frustration when many of their “active searches” are never be completed because of frequent "surprise" hiring or budget freezes Their lack of interest in reading resumes and interviews will increase your time to fill

8) Managers will focus less on recruiting

Manager’s interest in recruiting will decrease even further as the stress from their business workload increases, while their available staff decreases

They certainly won't be doing it as often

Frustration when many of their “active searches” are never be completed because of frequent "surprise" hiring or budget freezes

Their lack of interest in reading resumes and interviews will increase your time to fill

Potential problems 9) Technology budgets Budget for buying new technology (ATS systems or new software) are likely to disappear… but deals are available So either make your purchases immediately or be prepared to live with what you got for a while

9) Technology budgets

Budget for buying new technology (ATS systems or new software) are likely to disappear… but deals are available

So either make your purchases immediately or be prepared to live with what you got for a while

Potential problems 10) HR politics will get worse Build over buy will predominate They will ask you to fund other HR positions

10) HR politics will get worse

Build over buy will predominate

They will ask you to fund other HR positions

Work with the CFO

Work with the CFO

Build CFO “street creds” Building the business case Show you are “efficient” / low cost provider Quantify recruiting impacts on revenue in dollars Calculate the risks, delays & the added startup costs of reassembling the recruiting function Utilize split samples Turnaround weak business units

Building the business case

Show you are “efficient” / low cost provider

Quantify recruiting impacts on revenue in dollars

Calculate the risks, delays & the added startup costs of reassembling the recruiting function

Utilize split samples

Turnaround weak business units

Generating additional revenue Increase revenue or save big bucks Work with GM’s In-house temp agency Speak for dollars Bring executive search in-house (Savings and exposure)

Increase revenue or save big bucks

Work with GM’s

In-house temp agency

Speak for dollars

Bring executive search in-house (Savings and exposure)

Other possible action steps to consider

Other possible action steps to consider

Action steps for recruiting Prioritize your jobs and best recruiters Revenue generating jobs Rev impact jobs Focus on growing business units Focus on growing regions Mission critical jobs

Prioritize your jobs and best recruiters

Revenue generating jobs

Rev impact jobs

Focus on growing business units

Focus on growing regions

Mission critical jobs

Action steps for recruiting Focus on recruiting innovators Calculate their huge revenue and TTM impact (300 times) Realize that they are hard to sell Realize that they look and act differently during the hiring process

Focus on recruiting innovators

Calculate their huge revenue and TTM impact (300 times)

Realize that they are hard to sell

Realize that they look and act differently during the hiring process

Action steps for recruiting “ Do more with less” using “OPT” No $ Referrals (Give me 5, Drawings, Edward Jones, AmTrust) Events (Bring back 3 names) Employment branding (Speaking and writing) Social network profiles (EE profiles) Blogs Employee generated videos (Deloitte) CEO calls to candidates PDA parties

“ Do more with less” using “OPT”

No $ Referrals (Give me 5, Drawings, Edward Jones, AmTrust)

Events (Bring back 3 names)

Employment branding (Speaking and writing)

Social network profiles (EE profiles)

Blogs

Employee generated videos (Deloitte)

CEO calls to candidates

PDA parties

Action steps for recruiting Identify & then use low cost but high impact tools Boomerangs / corporate alumni Google searches for names New hire “who else is good” Reference referrals Names research Use interns Contests

Identify & then use low cost but high impact tools

Boomerangs / corporate alumni

Google searches for names

New hire “who else is good”

Reference referrals

Names research

Use interns

Contests

Shift to high impact tools “ Received 3 times the amount of applications” 48 hrs with videos was equal to 5 mths using ads

“ Received 3 times the amount of applications”

48 hrs with videos was equal to 5 mths using ads

Finally… other things that recruiters can do

Finally… other things that recruiters can do

Expand your Talent Management capabilities Other things recruiters can do A focus on internal movement – Rapid movement to areas of higher return (Booz Allen) Retention – Use sales skills to keep the best Aid in employment branding Help with layoffs Handle outplacements Sales

Other things recruiters can do

A focus on internal movement – Rapid movement to areas of higher return (Booz Allen)

Retention – Use sales skills to keep the best

Aid in employment branding

Help with layoffs

Handle outplacements

Sales

Did I make you think? Any questions? www.drjohnsullivan.com

Did I make you think?

Any questions?

www.drjohnsullivan.com